LIHUE — Two proposed bills to increase taxes were voted down during the Kauai County Council meeting Wednesday.
The bills, which would raise vehicle weight tax and fuel tax were introduced by Councilmember JoAnn Yukimura as a possible solution for funding $100 million worth of backlogged road repairs.
“I introduced both bills, not because I want to raise taxes, but because we must fix our roads,” she said. “If we don’t fix them, the cost of fixing them gets larger and larger, and we will have to pay for repairs to our cars due to bad roads.”
On Wednesday, the council voted 5-2 against Bill No. 2630, which aimed to increase fuel tax by 2 cents, starting July 1, 2016, and an additional 2 cents on July 1, 2017.
Saying they needed to explore other options to generate revenue, Councilmembers Gary Hooser, Ross Kagawa, Arryl Kaneshiro, KipuKai Kauali’i and Mel Rapozo voted to receive, or kill, the bill.
“I am adamantly opposed to raising any taxes that will impact local residents,” Hooser said.
One solution, Hooser said, is for the county to re-examine its areas of concern.
“One option is for the County to tighten its belt and restructure its priorities, putting road repair at the top,” he said. “Cutting non-essential positions and forgoing nonessential purchases could generate sufficient funding for the coming year.”
But because gas prices are low, it’s time to act, Yukimura, who voted against the receipt, along with Councilmember Mason Chock, said.
“Now is the window of opportunity to raise the taxes because it will take away only a small part of the savings that people are getting because of lower gas prices,” she said.
There are few feasible alternatives, she added.
“The (general) excise tax is probably the most viable alternative because a quarter percent excise tax would generate $10 million per year,” she said. “But I am opposed to using the excise tax for road repair because it is a regressive tax that hurts the poor and moderate income families the most proportionately.”
But, given the choice between the general excise tax and increasing fuel tax, Kaneshiro said he’d rather see the GET get passed.
“If the GET doesn’t pass, then we can look at other options,” he said. “If improvements are what we want to focus on, I’d rather have a broader tax base first.”
Other alternatives include getting a bigger share of the Transient Accommodation Tax, or TAT, and taking money from the general fund, Yukimura said.
On Wednesday, the council also voted down a proposed bill that would increase vehicle weight tax.
Bill No. 2631 proposed increasing the weight tax by one cent, bringing the cost per pound to 3 cents for non-commercial vehicles and 5 cents for commercial vehicles.
The council voted 4-3 against the motion to receive the bill.
Kagawa, Kaneshiro, Kauali’i and Rapozo voted to approve the motion receive. Yukimura, Hooser and Chock voted against it.
Hooser and Chock said they voted against the receipt of Bill No. 2631 because they are working on an alternative.
“I do not support the measure as it’s written now, and would vote against it in a heartbeat,” Hooser said. “But I believe it may serve as a vehicle.”
Their alternative is taxing rental cars.
“Rental cars represent a significant portion of highway use, yet pay a disproportionate amount of the costs associated with building and maintaining our roadways,” Hooser said. “A $300 annual weight tax for rental cars would generate millions of additional revenue for the county, yet would add less than $1 per day to the cost to consumers when passed on.”
Chock added: “We certainly want to look for continued ways to answer these issues. I think that this may be a vehicle for us.”
Hooser said he and Chock plan to introduce a new bill that will address the car rental proposal in the coming weeks.